Islamic Finance is ready to drive a State's economic system?

About this debate:

Islamic Finance has seen a massive growth in today’s transforming global economic environment. One of the vital elements to this impressive change and development can be witnessed in the global financial crisis of 2008 where Islamic financial institutions have managed to not only sustain but expand over the coming years. With above; 400 Islamic financial institutions now operating in more than 75 countries both Muslim and non-Muslim countries; with assets ranging from $1.5 to $2 trillion Islamic finance has become an important influence on the global financial stage.

The growth of Islamic finance, however, has its own challenges. One of many, includes the most talked upon by Muslim critics about the nature of Islamic finance. Some feel it is merely a means to give the conventional finance a disguise of Shariah, following the letter of Islamic law rather than its true spirit. Additionally industry experts argue that Islamic finance has occasionally comprised its basic principles in its effort to grow. Furthermore, there are challenges which are associated with retail banking.

Despite these setbacks, we’ve seen that Islamic finance has continued to grow and expand over the years. However, the questions still remain as to if Islamic finance is mature enough to be implemented as a State’s economic system? Or is it quite not ready yet to drive one? What are the other important challenges faced by Islamic finance keeping it from being a State’s economic system? Can it survive as one while those challenges being present at the same time?

Thus, these are some of the unanswered questions to which we shall see what our debaters have to say and eventually find answers to.

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Debaters' latest statements

Defending themotion

Head of Finance - First Global Group, Sri Lanka

Against themotion

Prof. Habib Ahmed, PhD

Sharjah Chair in Islamic Law & Finance - Durham University, UK

Let me remind ourselves as when Quran was revealed, there were only few people those who accepted it but the Quran was addressing to the entire human kind as an ultimate guidance. The concept of globalisation was first revealed by Quran by sending the messages to all. This was portrayed by many as idealism but as we all know it has been accepted and practiced as the way of life until now. When the Islam was introduced, it was considered as one of the ideal vision but it gave practical solution to every cry of the world by bringing the peace to the minds and world. I believe and I can see the progress of Islamic finance in a similar way, creating the legacy by the ideal vision by giving the... Read more

The pioneers of Islamic economics envisioned that an economy based on Islamic values and principles would strive to fulfill the goals of Shari’ah (maqasid al-Shari’ah) and result in achieving a just and vibrant economy. As the overall aim of Islamic law is to promote welfare or benefit (maslahah) of mankind and prevent harm (mafsadah), they argued that realization of the maqasid would produce a moral economy with a financial system that would serve the needs of not only Muslims but humanity at large. The implication of this vision was that other than fulfilling the legal requirements, an Islamic financial system would be ethical and cater to the social needs of a society. Based on this worldview,... Read more

Guests' latest statements

Guest

Dr. Gerhard Böwering

Prof. of Religious and Islamic Studies - Yale University, USA

The MUSLIM Institute of Islamabad focuses the first instalment of its newly developed online project, “The Muslim Debate,” on Islamic finance, paying much attention to the question of ribā. In fact, the discussion of this question has become quite popular among present-day ulama. In truth, however, the debate has been very much alive from an earlier phase of its existence. In the past, Fazlur Rahman established a scholarly basis for the arguments on ribā when he published his views in the journal of Islamic Studies in 1964. The legacy of his scholarly influence still reverberates in a selection of articles, collected in the more recent issue of Islamic Studies, volume 50, autumn 2011, and... Read more

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The Muslim Debate is a public debate forum of MUSLIM Institute. The Institute is a non-governmental, non-political and not for profit organisation that publicises research and advocacy on issues pertaining to Stability, Leadership and Unity within the Muslim world. For further info please vist www.muslim-institute.org